![]() ![]() You can use our sample letter B to give the background to your situation. A financial statement is just a summary of your income, expenditure, debts and offers to pay. Having made this plan, you can t hen send a letter with a f i nancial s tatement to your creditor explaining your situation. If yo u can’t afford your rep ayments, now or any time soon, use our free budget tool (or Full Financial Picture if you have more than one debt) to work out what money you have coming in and going out. Accept a lump sum payment to clear the debt.Pause or lower interest and other charges on your account.Lower or pause your payments to see if your finances get better.How much you can afford to pay each month.What’s happening (for example you lost your job or owe rent arrears).When you talk to your card company, tell them: Your credit card company is likely to be helpful if you are open and honest with them. If you are unable to bring down the debt through increased repayments, you can ask your credit card company for a repayment plan. A sk your credit card company for a repayment plan Talk to a MABS advis e r who can help with your budget, give you advice on different solutions and help you take the first step to lowering your debts. Still unsure what to do? We’re here to help. See ‘ Should I switch to a different card to pay off my credit card bills ’ below. Use this credit card comparison tool to see the different rates available at the moment. T his can sometimes help you to pay off your debt much quicker. Ĭheck if you can transfer your balance to a credi t card with a lower interest rate, or 0% interest on balance transfers. This will reduce the amount of interest added to your credit card debt each month. This helps you to keep an eye on how much you are spending.Īsk your credit card company to reduce the interest rate on your card (see below). Or, you could get a prepaid card that you can use wherever a credit card is accepted. Think about using a debit card instead of a credit card. This helps you to stop building up debts you can’t repay. ![]() Set the amount to a level you can afford. The interest can cost more and you’ll have to pay a cash advance fee. Th is will mean you can clear the debt sooner.ĭon’t withdraw cash with your card. Don’t buy anything more on your credit card if you can avoid it. Decide if you need this and if it is worth the amount you are paying for it. This will stop you from being charged late payment fees.Ĭheck if you’re paying for payment protection insurance (PPI). Set up a direct debit so you don’t miss payments or pay later than the due date. S o be prepared to make some cutbacks for a while as you take back financial control. You may have to get used to not using the card and making payments. You need to know how much you can afford to pay off your debt. Use this clearing your credit card calculator to see how paying more than the minimum will help you pay off your debt faster. This means you’ll clear the debt sooner and pay less interest overall. ![]() Pay a bit more than the minimum if you can. If you don’t, the company will charge a fee on top of interest, your debt will increase and your credit rating might get worse. Try to pay at least the minimum payment if you can. The top 4 things to remember are : P ay it back gradually If you are dealing with a single credit card debt and can afford to make some payments, t here are many different things you can do to pay off your credit card. We can help you deal with priority and urgent debts. Ĭredit card debt is usually classed as a secondary debt. They’re called priority debts and include things like rent, mortgage payments and gas and electricity bills. If you have other debts that can lead to being evicted or getting a court fine, deal with them first. How you deal with credit card debt depends on what you can afford to pay and what other debts you are dealing with. If you fall behind on repayments, don’t worry, there are things you can do to get back on track such as asking your credit card company for a repayment plan. Whether you’re having trouble making repayments or are in arr e ars (debt), the worst thing is to ignore the problem hoping it might go away. A nd more so when you can’t make your repayments. But they can also be an expensive way to borrow money, even when you are making your minimum repayments. Credit cards are a part of everyday life for many, especially when shopping online.
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